Thiruvananthapuram: The Kerala government has launched a sharp criticism of the Union Budget 2026 presented by Finance Minister Nirmala Sitharaman on Sunday, accusing the Centre of sidelining the state and pursuing policies that could harm both Kerala and the wider national economy. Chief Minister Pinarayi Vijayan said the budget reflects sustained neglect of Kerala, while Finance Minister K.N. Balagopal warned of economic consequences for the country.

“Kerala forgotten on the map”

Chief Minister Pinarayi Vijayan said the Finance Minister appeared to have “forgotten that Kerala is on the map of India”, describing the Centre’s approach as the biggest crisis facing the state. He asked Union Ministers from Kerala to explain the treatment being meted out to their home state.

The Chief Minister said several key demands were ignored in the budget, including a new AIIMS hospital in Kerala, high-speed railway corridors and a special financial package for the development of Vizhinjam Port.

He also opposed the Centre’s decision to retain the states’ tax share at 41 per cent, arguing that it weakens federalism and reduces the financial autonomy of states.

Central funding cuts deepen concerns

Raising concerns over Kerala’s finances, the Chief Minister said central grants had fallen sharply from ₹2.2 lakh crore in 2021 to ₹1.4 lakh crore. He pointed out that revenue deficit grants have been discontinued and said Kerala was denied its rightful share of the divisible pool, despite achievements in population control and income growth.

Budget “disappointing” for the country

Finance Minister K.N. Balagopal said the budget is “disappointing not only for Kerala but for the entire country”, warning that its policy direction could slow down India’s economy.

He said investment in agriculture, industry and rural areas has declined, adding, “This means there will not be more employment; money will not reach the rural areas.”

Impact on rural poor and public sector

Chief Minister Vijayan said the budget favours corporations while harming ordinary people. He highlighted cuts to the MGNREGA rural employment scheme and reductions in subsidies for food, health and fertilisers, warning that these decisions would hit rural households the hardest.

He also accused the Centre of neglecting public sector undertakings such as FACT and the Cochin Refinery, and said the budget failed to ensure fair prices for farmers’ produce or protect local agriculture from imports.

Mining policy draws sharp opposition

The Chief Minister strongly opposed the budget’s proposal to allow private companies to mine minerals with fewer environmental safeguards, calling the move “extremely dangerous”.

He said the proposal runs contrary to Kerala’s plan for a public sector mineral corridor linking Vizhinjam, Chavara and Kochi.

Past promises recalled

Chief Minister Vijayan said Kerala has repeatedly been let down by both Congress and BJP-led governments at the Centre, pointing to unfulfilled promises such as the railway coach factory.